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Snap Forecasts First-Quarter EBITDA Loss

Social media company posts better-than-expected fourth-quarter results.
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Snap, Inc.  (SNAP) - Get Snap, Inc. Class A Report  forecasted a first-quarter EBITDA loss after the bell Thursday, undermining a better-than-expected financial report for the fourth quarter.

The social media company said its adjusted EBITDA -- earnings before interest, taxes, depreciation, and amortization -- will range from -$70 million to -$50 million in the first quarter. Revenue is expected to be between $720 million and $740 million, vs. $462 million in the same period a year ago.

Analysts had been expecting the company to report a profit in the current period.

For the just complete fourth quarter, the company said it made an adjusted 9 cents a share on $911 million in revenue.

The company had been expected to report earnings of 7 cents a share, on sales of $852.3 million, based on a FactSet survey of 29 analysts.

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In the same period a year ago, the company posted a loss of 17 cents a share on sales of $560.9 million.

The stock has risen 108.3% since the company last reported earnings on Oct. 20.

"We delivered our first full year of Adjusted EBITDA profitability," said Evan Spiegel, CEO, in a statement. "As we look towards the future, we’re excited to build on our investments in augmented reality, mapping, and content to drive our ongoing growth."

Snap has invested in new filters and augmented reality capabilities for its popular photo-sharing app as it seeks to lock in user growth driven by the COVID-19 pandemic.  Snap said daily active users rose 22% year over year to 265 million. Analysts had been forecasting 257.9 million, according to Bloomberg.

Shares of Snap fell $3.71, or 6.4%, to $54.60 in after-hours trading.

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